The “third” estimate of U.S. real gross domestic product (GDP) for the third quarter of 2020 increased 33.4 percent at an annual rate, revised up by 0.3 percent from the previous estimate. The upward revision mainly reflected larger-than-expected consumer spending and business investment. Overall, a best-ever gain in real GDP exhibited strong recovery in both consumer spending and business investment, which was boosted by the CARES Act and the Fed’s “whatever-it-takes” Quantitative Easing. U.S. nonfarm employment, however, lost 140,000 jobs in December, the first decline since April amid a surge in COVID-19 cases. Housing starts in November continued to rise strongly by 12.8 percent year-over-year, benefitting from all-time low interest rates. The U.S. economic recovery is currently losing momentum due to new business restrictions imposed by the surge in coronavirus cases. The second stimulus package and the vaccine rollout, however, should promote a faster recovery in the near future.
Nevada’s economic activity continued to improve based on the most recent monthly data. The unemployment rate ranked the second highest (tied with Hawaii) after New Jersey. November air passengers and gaming revenue continued to experience double-digit year-over-year losses of 56.6 and 17.7 percent, respectively. October taxable sales only decreased by 2.8 percent from last year, thanks to increased personal income from the CARES Act.
Clark County also posted improved signals in local economic activity. The unemployment rate in November declined to 11.6 percent from 13.9 percent but remained the highest among large metropolitan areas. Total McCarran Airport passengers and visitor volume in November continued their substantial year-over-year losses of 56.8 and 57.5 percent, respectively. November gaming revenue and October taxable sales, however, only declined by 20.5 and 7.1 percent, respectively, from last year thanks to the CARES Act. Residential housing permits/ units in November experienced a strong gain, up by 115.1 percent year-over-year.
Washoe County exhibited stronger pickups in local economic activity compared to Clark County thanks to its more diversified economy. The unemployment rate fell to 6.1 percent and October taxable sales posted a strong year-over-year growth of 9.1 percent. November residential permits/units also rose by 13.2 percent from a year ago. November gaming revenue only contracted by 3.2 percent from last year despite a 28.1 percent loss in visitor volume.
Stephen M. Miller, Director
Jinju Lee, Economic Analyst
UNLV Center for Business and Economic Research
The views expressed are those of the authors and do not necessarily represent those of the University of Nevada, Las Vegas or the Nevada System of Higher Education.